(Posted Oct. 15, 2019)
By Linda Dillman, Staff Writer
An agreement between Jefferson Local Schools and the village of West Jefferson, sharing income tax from industrial park businesses, will channel more development dollars into school coffers.
The agreement, approved by the school board during an Oct. 14 meeting, sets up a process where the village will remit half of the income tax receipts from certain commercial building improvements in multiple Community Reinvestment Areas (CRA).
Specifically, compensation is paid out where the village grants property tax exemptions of more than 50 percent for up to 15 years for new or renovated property where the payroll meets or exceeds $1 million.
“This is a very important agreement for the schools and village,” Superintendent William Mullett said. “This took a long time and a lot of work.”
Board President David Harper called the tax abatement agreement an example of good teamwork and one on which both entities can continue to build a strong foundation for the community.
“This is one of the biggest ones we’ve had,” Harper said.
Under the agreement, compensation is remitted by the village on any commercial building that is subject to any existing or new expansion, providing it meets the payroll threshold.
From January 2020 through December 2024, the village will make monthly payments to the district equaling 50 percent of the income taxes received through the CRA. In January 2025 and for the remainder of the exemption period, the compensation is reduced to 33 percent.
The village has no obligation to pay compensation to the school district for any non-CRA exemptions.
In addition, according to the agreement between the village and the schools, “as a condition of approval of any CRA…, the village shall require any property owner that enters into a CRA agreement with the village to agree in a written agreement…to make compensation payments to the school district in the amount of one cent per square foot of each commercial building constructed or renovated during the term of the CRA.”
The school district and the property owner may agree to a one-time payment or periodic payments of the one-cent obligation. The village must notify the school district in writing at least 14 days in advance of taking formal action to adopt or enter into an agreement granting a CRA exemption for a property.